ELR Citation: ELR 21617
No(s). 94-16368 (9th Cir. Aug 28, 1996)

The court holds that a federal district court lacks personal jurisdiction over a Belgian corporation that formerly held, through a subsidiary, 80 percent of the stock of a company whose operations caused environmental contamination at a California site. A company for which metal was treated at the site alleged that the Belgian company is liable under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) for site cleanup costs as a former site operator. The court first rejects the argument that because CERCLA §113(e) allows nationwide service of process and nationwide minimum contacts analysis, personal jurisdiction over the Belgian company exists under Fed. R. Civ. P. 4(k)(1)(D), which allows a court to exercise personal jurisdiction over a defendant when service of summons is authorized by a U.S. statute. Section 113(e) authorizes nationwide service of process only in actions by the United States. The court also rejects the argument that personal jurisdiction exists based on revisions to Rule 4(k)(2), which expand the jurisdictional reach of district courts in federal question cases to a national minimum contacts test. The advisory committee notes explain that the new rule authorizes jurisdiction in federal question cases over defendants who have significant nationwide contacts but are not subject to jurisdiction in any state. The Belgian company had virtually no direct contacts with the United States. In addition, the court rejects the argument that jurisdiction is supported by Rule 4(k)(1)(A), which authorizes jurisdiction over a nonresident defendant who is subject to jurisdiction in the state where the district court is located. The Belgian company's contacts with California are attenuated at best. Its majority interest in the company that operates the reclamation site does not suffice to confer specific jurisdiction. Furthermore, the court holds that although specific personal jurisdiction over a nonresident defendant may attach in a tort case if the defendant engages in conduct aimed at or having an effect in the situs state, third-party plaintiff may not use CERCLA liability as a substitute for personal jurisdiction. The court rejects the argument that the Belgian company's domination and control, through a subsidiary, over the reclamation site operator constitute the contacts by which the Belgian company purposefully availed itself of U.S. benefits and protection. Third-party plaintiff failed to make out a prima facie case that the site operator was the Belgian company's alter ego. The circumstances relied on to establish the Belgian company's domination over the site operator reflect no more than a normal parent-subsidiary relationship.

Counsel for Plaintiff
E. Robert Wright
Thomas, Snell, Jamison, Russell & Asperger
2445 Capitol St., Fresno CA 93716
(209) 442-0600

Counsel for Defendant
Jeffrey S. Koenig, Bruce G. Merritt
Debevoise & Plimpton
601 S. Figueroa St., Ste. 3700, Los Angeles CA 90017
(213) 680-8000

Before: BROWNING, CANBY and HALL, Circuit Judges.